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Late payments on U.S. credit cards fall in Q1 -bank group

WASHINGTON, July 10 (Reuters) - U.S. consumers' bank card delinquencies dropped in the first quarter as borrowers used credit cards for transactions rather than as a form of debt, the American Bankers Association said on Thursday.

Late payments on cards fell to 2.44 percent of all accounts, compared with 2.60 percent the previous quarter. That was well below the 15-year average, the bankers group said.

"More and more consumers are using their credit cards as a payment vehicle, paying off or paying down their balances each month," said James Chessen, chief economist at the bankers group.

A composite ratio that tracks delinquencies across eight loan categories rose slightly to 1.63 percent after two quarters of record lows, the group said. That ratio includes auto loans and personal loans but not bank cards.

The composite ratio remains well below the 15-year average for consumer delinquencies of 2.33 percent, the ABA said.

The bankers association defines delinquencies as payments that are more than 30 days overdue. It does not track traditional mortgage payments.

"With an improving economy and continued consumer vigilance, we expect delinquency rates to fluctuate at this lower end of the range for the foreseeable future," Chessen said.

Delinquencies on personal loans and home equity loans rose during the first quarter, while late payments fell for direct auto loans and property improvement loans, the ABA said.